Auto Loans: A Quick Overview
The private auto loans granted by banks can only be used to purchase a car. You can get an amount, however, it involves a thorough verification of the creditworthiness of applicants, a large number of formalities and a relatively long waiting time for the bank’s decision.
How does it work?
The alternative is smaller car loans, which have many non-bank loan institutions on offer. In this case, even those with low creditworthiness have a chance of financial support. Money is transferred to your account in up to 15 minutes, and the verification formalities are limited to a minimum.
Choosing a contract with a bank, we decide on a large, long-term financial commitment. The repayment of lower, short-term loans is definitely easier. Depending on the amount you need and our financial options, you can find a satisfying offer.In the event of an urgent need to change the car and not have enough funds, the bank and non-banking institutions providing loans for this purpose may help. For a car loan in the bank, people with impeccable credit history and high scores in credit can try. Everyone else has a chance to raise funds through loans in non-bank institutions. Pursuant to the Banking Law, before the loan is granted, the Bank is obliged to verify the creditworthiness of the borrower, even if the latter did not agree to it. It should be remembered that the lending policy of individual banks may differ. This results in offering the same person different terms of the contract or even refusing to grant a loan, depending on the Credit Information Bureau’s score. Non-bank loan companies obligation to verify borrowers is not applicable. It is only a voluntary, additional element affecting the final decision to grant a loan. Most companies also check the following registers: KRD, BIG, Info monitor, and ERIF, but there are also those that provide loans for the purchase of a car despite the negative credit history.Low credit scoring can make it very difficult to get a loan.
Checking the creditworthiness of clients assures the lender that the funds invested by the company will return with interest at a given time. Credit Information Bureau provides, among others information on repayment delays, using the credit limit and high credit activity of borrowers. Non-bank tax institutions also include those for which BIK data do not matter. However, it should be expected that the credibility of the borrowers can be verified in the ERIF and BIG Info Monitor databases.